Tough Tech Off

On June 24, Union minister for information technology Pramod Mahajan widened his grin and told a crowded Oberoi room in Mumbai: "I'm pleased to get into this argument with the Massachusetts Institute of Technology (mit)..." He turned a bit serious, of course, and corrected 'argument' to 'agreement'. Some may say that it was an omen, but as things stand, the Government of India has signed a deal with mit to create what is called Media Lab Asia. The original mit Media Lab is, of course, a legendary research unit, and along with Bell Labs, perhaps the world's best-known centre for futuristic information technology initiatives. The Asia venture will work towards bringing technology to the masses, creating cheap products that the poorest of rural Indians can afford and innovate ways and means through which healthcare and disaster-management can be improved.

It's all for a good cause. But it needs money. Media Lab Asia is being touted as a billion-dollar project. The first year will be an exploratory period, with the government playing the beneficiary—it has promised Rs 65 crore or $14 million. Based on the success of the first year, the government will sign a 10-year agreement with the mit. Of the $1 billion required, 20 per cent is expected to come from the government and the rest—$800 million (Rs 3,600 crore)—has to come from non-governmental sources, primarily from the private sector. And that's precisely where the hitch lies. Will the Indian IT segment put in money?

While the global rate of corporate investment in r&d is 12 to 14 per cent of the turnover, the figure for Indian companies is about 1.5 per cent. The government hopes the mit brand will attract Indian corporates. The mit Media Lab has over 800 sponsors but India could be a different scenario.

An Infosys spokesman said it was too early for the company to say whether it will be a sponsor. But Nandan Nilekani, Infosys MD, acknowledges the worth of the lab. Says he: "This lab, in the Mumbai-Pune Knowledge Corridor, will be an important step. The fact that the mit has selected India is a measure of the importance that the global IT community accords to India."

India beat countries like South Korea, China and Singapore to bag the honours. But the first year will be an anxious period for all concerned. Says Mahajan: "This is not a public sector enterprise. In fact, I want the government to have nothing to do with it in the near future. The autonomy of the lab depends on a healthy corporate participation." S. Ramakrishnan, senior director with the IT ministry, adds: "A crucial factor during the evaluation of the project, at the end of the first year, will be the enthusiasm of the corporate segment. If we are eventually able to raise Rs 6 crore from them in the first year we'll be happy."

The biggest incentive for the corporate sponsors is that they will have free access to the intellectual property rights (ipr) of the products created in the lab. Says Mahajan: "The ipr will be shared on a non-exclusive basis by all the sponsors. Doesn't matter if one company has put in 1 million and another has put in 100 million." The entry cost for a company to qualify as a sponsor is, however, yet to be worked out. But Indian companies as also the foreign corporates—like Microsoft and ibm—who may want to be part of the lab, are worried about the Indian government's competence in tackling the ipr issue. Says noted academician R.S. Ganapathy: "The ipr issue hasn't been completely sorted out. Will there be a two- or three-year period after which a company can buy off the royalty for an innovation? Or, will all sponsors equally share the rights over the products forever? Corporates need to be very sure that they can make money at the end of the day." He points out that corporate sponsorship is extremely vital for the effectiveness of the lab because, "if the government stake is more than 40 per cent then, constitutionally, no employee of the lab can earn more than Rs 25,000 a month. This will directly affect the quality of human resource."

But the academic head of mit Media Lab, Alex Pentland, who is also the chief of Media Lab Asia, is optimistic. Says he: "There are some negative comments about how the money may be spent and other such issues. But otherwise everybody is excited."